Fundamental Drivers
United States
Investors are closely watching the upcoming Jackson Hole Symposium, the Federal Reserve’s annual meeting, which is expected to provide greater clarity regarding the future direction of interest rates. Additionally, risk sentiment and USD strength are being shaped by an important meeting between the US and Ukrainian presidents. While there is ongoing speculation about potential interest rate cuts, the interest rate differential continues to support the US dollar, lending strength to the currency pair.
Japan
Japan reported stronger-than-anticipated GDP growth in the second quarter, bolstered primarily by net exports. This growth comes despite pressures from US tariffs. Meanwhile, Bank of Japan Governor Kazuo Ueda remains cautious, highlighting that core inflation has yet to reach the 2% target. This stance indicates that immediate rate hikes are not expected.
Technical Analysis
Support Levels
• Primary support levels are found at 145.70, 146.20, and 144.50.
• Short-term support ranges from 146.40 to 146.60.
Resistance Levels
• Primary resistance is identified at 147.60, 148.50, and 149.15.
• If the price moves above 148.50, the next breakout target is set at 151.00.
Indicators
• The 50-day EMA is acting as support near 147.00.
• The 200-day EMA presents resistance around 148.00.
• Bollinger Bands are narrowing, signaling low volatility and the potential for a breakout.
• MACD and RSI indicators are neutral to slightly bearish, suggesting that the pair may continue to trade within its current range.
Trading Scenarios
Bullish Setup
• Buy Zone: Entry above 147.60.
• Targets: 148.50, 149.15, and 151.00.
• Stop-Loss: Placed below 146.20.
Bearish Setup
• Sell Zone: Entry below 145.70.
• Targets: 144.50 and 143.80.
• Stop-Loss: Placed above 147.00.